The premise is pretty hard to swallow. Let’s look at a billionaire like Bill Gates. How does he take all his wealth and leave? Does he pack up the Microsoft Corporation and put it in his spacecraft?
The most he can do is sell his stock. And when he sells his stock, somebody else buys it. So it probably stays right here in the United States. And if he does sell it overseas, so what? Lots of American corporations are owned by non-Americans - the jobs and the business are still here in America.
I’m just picturing a spaceship with a large cabin to hold all the money the rich leave Earth with - just a huge room filled with coins and bills so they can swim through it like Scrooge McDuck, only in zero-gravity.
As long as we’re in a hypothetical, there’s no reason the US wouldn’t do something very radical in response in order to keep the economy from undergoing the massive deflation that would be associated with so much hard currency leaving the country.
So the top 2% holds 50% (at a guess, since the top 1% held 42% in 2007) of the approximately 50 trillion dollars of wealth owned by US citizens. I’ll be generous and guess they can take 1 trillion of portable property (art, etc) with them on their spaceship, and the other 24 billion in cash. Let’s be even more hilarious and assume that they can all instantly covert all non-portable assets to their current cash value (rather than the markets for all of them collapsing)
Since all that currency is going into space, attached to no physical property here there would literally be no reason for the Treasury not to invalidate it as soon as they leave orbit and print up (real or electronic) 24-25 trillion. The total currency in circulation isn’t affected, after all. Then what? Every man, woman, and child gets an instant $83,000 stimulus check? There’s a glut of business grants and an application process to buy the remnants of the businesses left behind? Pick your poison?
You’d see an adjustment period, maybe ten years tops, and then things would be swimming again with a different set of rich folks. All you’d ultimately be accomplishing is to level the playing field between the middle class and the (now absent) rich, and unless you’re the kind of person who thinks every savvy person gets rich and no unsavvy people do, the slack will be picked up.
Yeah, that’s what I’d expect. Once the money leaves the planet, it no longer exists, as far as anyone still here is concerned. The U.S.S. Rich People just carried tons of worthless paper into space. Yay for them! Rev up the presses!
They’d come crawling back as soon as the toilets started backing up and none of them knew how to fix them.
I haven’t argued that the top 1% are irreplaceable, merely that replacing them would be less than straightforward or immediate.
And the fact that they need to be replaced in order to restore federal income tax revenues tends to show that they are not necessarily the evil exploiters that the left often demonizes them as.
Maybe we make the scenario a bit more realistic by assuming they take their money out of the economy in non-cash form, so it represents a net and not easily recoverable loss to the economy. Suppose somehow they needed lithium for their spaceship, so they managed to buy up all the lithium on earth, so much less was available for batteries. We could replace it with other elements, no doubt, but again, that would take time, and would cost more. Or tungsten, or some other rare but important mineral, or a combination of them.
As Hentor mentions, there is not a one-to-one correspondence between the richest people on earth, and the smartest, but rich people are not generally stupid IME, especially not about their money. And I suspect it would occur to them as it occurs to us that coins and bills aren’t worth much in space, and leaving it in investment accounts means that it stays on earth where it doesn’t benefit you.
If we are coming up with thought experiments where the rich take their baseballs and get out of the game, that seems a bit more realistic than thinking they will take cash with them into space.
Regards,
Shodan
Essentially, I see this as a threat of “I’m leaving my ball and going home!”
I think the OP doesn’t understand what money IS. A dollar bill is a coupon that other people will exchange for goods and services.
So suppose tomorrow I go to your store, and instead of offering to buy my groceries with dollars, I offer to give you a coupon for one free backrub. You accept, and I owe you a backrub for the groceries you gave me. Except you don’t want a backrub, so you trade the coupon to the bookstore owner for your crime novels. And the bookstore owner trades the coupon to the liquor store owner for some hooch. And the liqour store owner trades it for some chickens.
See how this coupon acts as money? This is exactly how gold, cowrie shells, cacao beans, and cigarettes were used as money.
And then, suppose the chicken farmer decides to build a spaceship and leave the planet with all his money, which consists of one backrub coupon. That backrub coupon is now in orbit around Mars. And what happens next? Nothing. What happened is that the chicken farmer gifted me the value of one backrub by essentially ripping up the coupon. Everybody else got their expected value by trading the coupon, except the chicken farmer.
The only thing of value that got lost was my promise to perform a future service to the bearer of the coupon. Except, now that the coupon is gone, I can just issue another coupon without fear that I’ll be overbooked.
So taking a truckload of dollar bills into space has no real effect on the economy, except to make the value of every other dollar bill increase. Those dollars represent value that the holders of the dollars were entitled to in the future, and they’ve essentially thrown that away. So however they earned that money, by performing whatever services, they’ve essentially performed all those services for free because they’ll never come back to claim the goods and services they would have been entitled to.
This is a completely different question than what would happen if rich people bought up a lot of actual goods, and then shot all those goods into space or tossed them onto the bonfire of the vanities. Because then they’d be actually destroying things of value. Destroying money doesn’t actually destroy anything. It could slow the economy if there isn’t enough money around for transactions to proceed smoothly. But in our future economy of 2011, almost no money is denominated in paper bills. The majority is simply bookkeeping entries in a bank’s database.
If we want more money we can just make more. In a situation of severe deflation from the destruction of money, it would be pretty painless for the government to simply create enough money to cover the amount lost. The reason we don’t want to do that in ordinary times is that would cause inflation, create more money and the value of existing money falls, if you create twice as much money that means you’ll have to pay twice as much for that candy bar. And this means that contracts and debts and loans will suddenly become screwy, because you borrowed $X from me and now when you pay it back, that $X is worth half as much. So why would I lend you money? I’d have to charge extremely high interest. But what if I’ve misjudged the amount of inflation? Then one of us gets screwed. So high inflation and variable inflation makes all sorts of financial planning very difficult, which is why we don’t want it.
The other side of the equation is exactly the same as asking what would happen if the top 1% just dropped dead tomorrow. Note that this would be 3 million people. If we had a war or a plague or a disaster that killed 3 million people at random, it would be a horrible shock to the economy. But one that killed the top wage earners would be much much worse.
Note that “the rich” and “top wage earners” are overlapping but not exactly identical sets. Plenty of rich people don’t earn wages, or they see the value of their assets drop in a year. If Uncle Pennybags gets his money from stocks, and the value of his stocks drops from $100 million to $80 million, he’s earned no money, but he’s still incredibly rich. Likewise, MC Hammer can make $1,000,000 in a year, but if his expenses are $2,000,000, pretty soon he’s going to be broke.
So are we looking at killing off the top 1% in incomes, or the top 1% in assets? There’s going to be a lot of overlap, but there’s a difference. People making incomes are contributing something, of whatever dubious quality. Shooting them into space means they don’t provide whatever it is that they used to provide. But asset holders, when they die, their assets just pass on to their next of kin. No assets actually get lost. Of course, asset holders can also provide value, and often do, that’s how they got those assets in the first place.
Whether or not that’s “more realistic” is, I think, entirely dependent on whether the OP wants to examine the loss of actual wealth (real things), denominated wealth (cash money), or income. From his phrasing most of us are assuming the latter two but not the former.
All three are interesting thought experiments.
Well, let’s assume the first case and the space-going wealthy took all variety of art objects and such. Would us poor left-behinders still have copies? And what would stop us from creating new objects? And if they monopolized some crucial element like helium or molybdenum, that would be a nuisance but alternatives exist, or we could resume mining (on the assumption that even if all known quantities were taken, untapped quantities remain though have been too expensive to pursue as yet).
What on Earth isn’t replicable or replaceable?
For the most part, engineers making $250 K are managers, and not doing the dirty work, so no problems. Doctors - yes, many specialists, but there would be plenty of young doctors ready to step in, and the medical schools might have to accept more people. Lawyers? There is an employment problem for young lawyers, so no problems there. Now, the financial services industry would be a lot harder hit, but good riddance, and they might have a lot of fun developing exotic product for egg and bacon futures on their spaceship.
This. The OP, (and his friend) demonstrate a profound ignorance of economics, which I think is indicative of why we’re in the mess we’re in. Beyond what you say, if everyone on a spaceship has a billion dollars, the prices of an egg would soon become a million dollars. Or, if the refugees respect property rights, those with $250K would soon find themselves poor. Either the truly rich would hire some of the new poor as guards and oppress those with only a million bucks, or the masses of the new poor would take money from the truly rich, most of whom would be pretty old.
BTW, there would be plenty of assets left on earth. Someone earning $250K might be in debt, and many people making less than that have lots of assets.
What would actually happen is that they’d convert all their assets into gold, and the overloaded spaceship would crash on takeoff. 
If we’re talking “not easy”? Trace metals and strategic metals, and noble gases. Helium, lithium, ruthenium, molybdenum, that kind of stuff.
Well, if those were all taken by the Voyage of the Clammed (as I would call the spaceship of the rich - alternate title: the Voyage of the Scrammed) I’m sure it would be a nuisance and inconvenience and there are a number of 20th- and 21st-century technologies we’d have to give up, until we found alternatives.
Of course, unless space travel requires vast amounts of ruthenium, I’m not sure why the wealthy are taking it, except possibly to be dicks.
My off-the-cuff guess is that someone gave someone else a misguided interpretation of Atlas Shrugged. I’m probably wrong, but that’s just my guess.
And the increase of the value of a dollar isn’t significant? Whether or not paper coupons have intrinsic value, we’ve assigned them a value. One paper coupon can buy you a can of soda. Four paper coupons can buy you a gallon of gas. I don’t know how many paper coupons there actually are, but let’s say it’s 100 trillion. If 50 trillion of those paper coupons were suddenly gone, wouldn’t the remaining 50 trillion be worth twice as much? Maybe not exactly twice as much, but a great deal more than they were previously worth, because there are less of them to exchange, right? At least until prices increased to match the new value.
And what if the chicken farmer was aboard that spaceship with 7 million other people who also had coupons for backrubs? Couldn’t those coupons still be exchanged for other goods and services? Couldn’t the spaceship government simply make backrub coupons the legal currency?
Probably this. I didn’t know what Atlas Shrugged or Galt’s Gulch was until you mentioned it. Thanks for the enlightenment. 
But the number of dollar bills in circulation isn’t a fixed amount - the supply varies daily based on what the banks do, as directed by the overarching authority, be it the Federal Reserve or Bank of Canada or whatever. If the sudden disappearance of, say $50 trillion in banknotes were removed from circulation, the various countries would just print more and direct their banks to release more to take up the slack.
And the disappearance wouldn’t be sudden, either, unless we stretch the hypothetical beyond the plausible and assume this interplanetary spaceship gets built and stocked overnight.
Are we talking about household or individual income? The economic effects of removing all the VP’s ($500k annual comp) and their non-working spouses should be different than removing all of them plus all of the low-level engineers married to other low-level engineers ($125k annual comp each). Using household income would also mean that dual-income highly compensated professionals would beam up with Warren Buffet but their unmarried or single-income colleagues would stay put, doing the exact same job.
No idea about the entrepreneurs, the millionaires, or the effect on the overall economy. However, for the industries that rely on highly compensated professionals, I’d bet it would look a lot like last ~10 years in the US petroleum industry, where goofy demographics and an upsurge in activity left a big hole at the upper pay levels. Expect a lowering of degree requirements and a rise in salaries and long-term incentives across the board as companies go apeshit scrambling to hire/retain warm bodies to cover the workload that the senior staff were handling before they hopped on the spaceship. Longer term, the least qualified or lowest perfomers would probably be quietly laid off during the next downturn.
TLDR Version: New hires and low level guys get jumped way up the pay ladder to make up for loss of old experienced guys.